BANK OF N.T. BUTTERFIELD & SON LTD (NTB) Tops Q4 EPS by 13c, Revenues Beat

BANK OF N.T. BUTTERFIELD & SON LTD (NYSE: NTB) reported Q4 EPS of $0.86, $0.13 better than the analyst estimate of $0.73. Revenue for the quarter came in at $125.3 million versus the consensus estimate of $121.9 million.

Financial highlights for the fourth quarter of 2020:

• Net income of $42.1 million, or $0.84 per share, and core net income1 of $42.9 million, or $0.86 per share
• Return on average common equity of 16.9%, and core return on average tangible common equity1 of 19.0%
• Net interest margin of 2.25%, cost of deposits of 0.12%
• Board declares dividend for the quarter ended December 31, 2020 of $0.44 per share
• Board approves a new 2021 share repurchase program of up to 2.0 million common shares

Michael Collins, Butterfield's Chairman and Chief Executive Officer commented, "2020 was an extraordinary year for Butterfield. We finished with a strong fourth quarter, having successfully navigated the challenges of a global pandemic, while continuing to position the Bank for growth and sustainable risk adjusted returns.

“Our primary operating jurisdictions in Bermuda, Cayman and the Channel Islands have managed COVID-19 relatively well. Butterfield reacted quickly with no significant disruption of services, even during periods of government mandated lockdowns and strict employee and customer safety protocols.

"We also implemented a broad-based mortgage loan deferral program to help our customers manage through the initial impacts of the pandemic. Given the economic headwinds, we have increased credit monitoring and remain cautiously confident that our conservative underwriting and an improving economic outlook are evolving into relatively mild deterioration in credit quality. We recognize that the pandemic is not over and will continue to work with customers who experience difficulty.

“Facing challenging trading conditions and historically low market interest rates, we improved operating efficiencies through voluntary separation and early retirement programs, targeted redundancies, and service role migrations to lower cost jurisdictions.

“Capital management remained an important value driver with quarterly cash dividends and share repurchases supporting earnings per share growth, as well as dividend return. We also improved the efficacy of our capital profile through a $100 million subordinated debt issue in June.

"We reached important strategic milestones this year. In the Channel Islands, we achieved meaningful market share growth and successfully completed the full integration of the acquired ABN AMRO business. It was also notable that, while all jurisdictions performed well, contributions to annual earnings from our Cayman segment have now surpassed Bermuda for two years running.

"Finally, during 2020 we enhanced our management team and Board through new appointments, with exceptional banking, compliance, risk management and communications experience. I would like to thank all of our stakeholders, including our dedicated staff and loyal customers, for their continued commitment to Butterfield’s ongoing success.”

For earnings history and earnings-related data on BANK OF N.T. BUTTERFIELD & SON LTD (NTB) click here.

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